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The major changes with Health Reform will be enacted on January 1, 2014 which will create change for small and large group employers. While small groups are not mandated to offer coverage (There is not an inadequate or unaffordable coverage penalty for small groups) they will still see changes. Health plan renewals for 2014 will be increased 30% to 50% over the normal renewal making it very difficult for many employers to offer coverage. The individual and small group (Called Shops) exchanges will also be available. Ultimately, small groups will have five options for health care offerings in 2014. All five options are reviewed in depth below. Read more

Small Groups will be eligible to buy insurance on the Exchange through a SHOPs (Small Business Health Options Programs) starting in January 1, 2014. A small group is currently defined as a group with less than 50 equivalent full time eligible employees. This number will change to 100 full time eligible equivalent employees on a state by state basis starting in 2014 to 2016. Each state can choose when they will move to the 100 full time equivalent rule. There is not any information on the small group exchange currently available (As of June 2013). We have not been told which companies will be available, types of plans or premiums. I will update this post when the criteria has been determined.

Small groups are not subject to any penalties for not offering care or failing to meet the minimum benefit and premium guidelines. Employees may go and purchase plans through the individual Exchange regardless of if the small group is offering benefits or not.

In order to determine the number of full time employees, seasonal and part time workers must also be taken into consideration. Assume an employer has 20 full time employees and 40 part time employees, each of whom averages 90 hours of service per month. Each of the 20 employees averaging 35 hours of service per week are counted as full time employees. To determine the part time employees take the total hours of service of the part time employees (90) multiply by the total number of part timers and then divide by 120. (90 x 40 divided by 120 =30) This means that the employer has 30 extra full time employees for a total of 50 employees.

Small groups with less than 25 employees are currently eligible for a 35% premium tax credit. The credit is 35% of the monthly premium the employer contributes toward the health insurance costs. This number will move to 50% in 2014. In order to be eligible for the tax credit, groups must fall within the following guidelines.

Fewer than 25 full time equivalent employees

Average employee wages of under $50,000 annually

Employer must cover at least 50% of the cost for health insurance.

Groups will only be eligible for the tax credit when they purchase insurance through the SHOP exchange. Groups are not eligible if they purchase a plan directly from an insurance carrier. (Insurance carriers will still be offering plans) Only small business owners and small business employees will be able to purchase insurance through a SHOP plan.

Other Options –Small groups that want to continue offering standard group employee coverage can certainly do so. The negative is that health reform is likely to drastically increase small group rates (outside of the SHOP) in 2014. Estimates range from 20% to 50% on top of the normal renewal. Such increases will make it difficult for many small group employers to continue offering standard small group insurance plans. As a result, many small group employers will use the SHOP plans or have their employees simply buy on the individual exchange.

Alternate funding methods may also come in to play in 2014. Small groups do have the option of experience rating their groups which would circumvent many of the health reform mandate rules and avoid the drastic rate increases as a result.

Health Reform (Affordable Care Act) will have a major impact on most Connecticut residents. The mandatory changes will be taking place in Connecticut on January 1st, 2014. How will health reform effect you? It mostly depends on how you access health care. Those on Individual health plans will have major changes while people on large employer plans may not notice much change.

Health Exchange- This term is widely used when describing Health Reform. The Health Exchange is a place where individuals (There will be a group/company exchange as well) can go to find a health care plan. The plans in the exchange will all be similar from a benefits standpoint and companies will need to meet minimum benefit and pricing standards to have an offering. There is a link below which provides more information on the Exchange. There is very little information available on the group exchange.( Called SHOPs -Small Business Health Options Programs) Small groups will be eligible for the premium credit through the group exchange only.

Each state has decided if they will administer the new program on their own or use the Federal Government to do it. The initial thought in congress was that most states would be running their own Exchange which turned out to not be the case As it stands today, 50% of the states have opted to have the federal government run the Exchange.

We have broken down the changes into categories below with a summary of changes for each group effected. Click on the links to learn more about each section. If you have additional questions, you may call our office or send me an email any time. Emails may go to [email protected]

Health Reform (Affordable Care Act) uses state and federal exchanges to organize health care offerings. Each state had to choose to offer their own exchange or instead, utilize the federal governments exchange. Connecticut decided to create their own as did about 50% of the states.

Start Date: The Connecticut based exchange will be up and running on January 1, 2014. The enrollment period will start on October 1, 2013 for a coverage start date of January 1, 2014.

Who Can Get A Plan?: Just about any Connecticut resident under the age of 65 can get a plan starting in January. There are no exclusions for health conditions and pre existing conditions and not be taken into consideration.

What are the Benefits?: There will be 4 plan types offered in the exchange called Bronze, Silver, Gold and Platinum. The Bronze has the lowest benefits and they increase by plan with the Platinum having the best benefits. Basic benefits levels are 60% coverage Bronze, 70% Silver, 80% Gold and 90% Platinum.

Kaiser summarized the benefits in this manner:

Households between 100 percent and 150 percent of the federal poverty level can get a plan that covers 94 percent of costs (more than a platinum-level plan would) with an out-of-pocket spending cap that’s one-third of the standard HSA level.

Households between 150 percent and 200 percent of the federal poverty level can get a plan that covers 87 percent of costs (more than gold, less than platinum) with an out-of-pocket spending cap that’s one-third of the standard HSA level.

Households between 200 percent and 250 percent of the federal poverty level can get a plan that covers 73 percent of costs (just above the silver level) with an out-of-pocket spending cap that’s one-half of the standard HSA level.

Households between 250 percent and 300 percent of the federal poverty level can get a silver plan with an out-of-pocket spending cap that’s one-half of the standard HSA level.

Households between 300 percent and 400 percent of the federal poverty level can get a silver plan with an out-of-pocket spending cap that’s two-thirds of the standard HSA level.

How Much Does It Cost?: The amount of premium that an individual or family pays is based off the federal poverty level. The poverty level for an individual in 2012 was $11,170 and increases with each additional family member. The plan rates are reduced for those within 400% of the poverty level. Those earning over 400% will not be eligible for a subsidy and will pay the full premium. The subsidy is based on a percentage of income that can be paid. NOTE: There are examples at the bottom of this post giving examples of the actual monthly cost.

Single Example: In Connecticut, an individual making less than $16,000 will be eligible for Medicaid, those making $25,000 a year will pay $144 a month for the Silver Plan. An individual making $45,000 will pay $341.00 a month and a person making more than 50K will pay the full premium which is yet to be determined but will be a substantial number.

Family Example- A family of 4 making less than $31,000 will be eligible for Medicaid, if they make $40,00 they will pay $165.00 a month, making $60,000 a year will be $410.00 a month, $80,000 a year will be $633.00 a month and those over $95,000 will pay the full cost of the plan.

Individuals and Families already on non group health plans- For those that already have a non employer based health insurance plan, it is not yet known if they will be able to continue their plans or if they will need to come off the plans on 1-1-12014. I will update this post when more information is available.

The Affordable Care Act brings major changes for large group employers in Connecticut. Employers that meet the definition of “Large Group” will need to meet thresholds for affordable care and adequate coverage. Failure to meet the guidelines will result in penalties for the employer. Employer groups will

In Connecticut, a large group is one with more than 50 eligible employees however, the definition of a small group will change some time between 2014 and 2016 as the number will be moved groups with 100 or more eligible employees. Full time, part time and seasonal employees count toward the total amount of employees eligible. A portion of part time employees count toward the full time total. This number can be determined by multiplying the average number of hours worked per month by the number of part time employees and then dividing by 120. Example: 40 seasonal employees working an average of 90 hours a month divided by 120 40 x 90 divided by 120 = 30 extra full time employees. Multiple companies with the same EIN number must also be combined. If a there are multiple companies with under 50 employees under the same EIN, the employee count will be combined to determine groups size.

Seasonal employees’ hours are included when determining applicable large employer status. An employer will not be a large group if it employed 50 or more full-time employees for no more than 120 days in he preceding calendar year and the employees causing it to reach or exceed the 50 full-time employee threshold were seasonal for more than 120 days.

Large groups will face a penalty if they have an inadequate or unaffordable offering. The penalty will be $2,000 per employee per year, excluding the first 30 employees. The penalty will only be triggered if an employee goes to the individual exchange and qualifies for a subsidy. If an employee does not qualify for a subsidy on the exchange, the employer will not be subject to a penalty. Spousal coverage is not a requirement for employers and the will not be penalized if a spouse is able to receive a premium tax credit on the exchange.

The changes listed above will not be applicable to groups with renewals in 2013. For example, if a groups renews the group insurance plan in October of 2013, they will not be subject to the new guidelines until October 1, 2014 when the plan renews. It is likely that many groups will look at a late year renewal as a means to buy more time and avoid the new guidelines for another 12 months.

Medicare Supplement plans (also called Medigap plans) are standardized in Connecticut. This means that plans must have the same benefits regardless of the company offering them. The only difference is in the service and the monthly premium of the plan. Supplement plans in Connecticut are organized by letters A-N. The most popular plans are F,N and L. Keep in mind that a Medicare supplement plan is secondary to original Medicare and have no network as a result. Medicare Supplement plans also do not come with drug coverage. That must be purchased separately through a PDP “Prescription Drug Plan”.

Premiums for all plans offered in Connecticut are attached in this blog. This includes every company that is offering a plan in CT and every plan letter they offer. Rates are subject to change from as the companies are allowed to have a rate increase once per year. This blog will be updated a few times during the year to ensure that accurate rates are being posted.

Transamerica has received approval for their Long Term Care rider in Connecticut. They are now able to offer the Trans ACE GUL “Guaranteed Universal Life” product with a long term care rider in Connecticut. Other companies have been able to get approvals for life/LTC combo plans in CT but they are always single deposit products or limited deposit. The Trans ACE is a true GUL policy that can be paid monthly like any other permanent life policy. Adding the LTC rider will increase the premium but the overall rider cost is much less than the cost of buying a stand alone Long Term Care Plan. Highlights and unique features….

Any money not used as long term care is paid out to beneficiaries at death via the plans GUL death benefit.

The cost of the Long Term Care rider is substantially lower than buying a stand alone LTC plan.

If the Long Term Care is never used, the GUL will still pay the full death benefit upon death.

The plan comes with a return of premium feature which returns 100% of paid premiums. The premium can be taken back in year 15, 20 and any year after 25.

Aviva has released a new annuity named Target Horizon. The product comes with income riders but also offers a much better accumulation strategy that other annuities in the market today. Trends in the annuity market are all moving toward offering new types of income riders (to generate future income streams) without any emphasis on the account accumulation (cash growth) of the product. Target Horizon moves against that trend by focusing on the ability to grown the account value substantially without risk of principal. The key components and features are as follows:

State Approvals: Approved in all states except for: NY, VA, TX, OK, WA and DE

Accumulation Strategy: 100% of all gains on an annual point to point basis after a spread. (“spread” is an amount of interest the company keeps prior to crediting interest to the account every year) Spread ranges from 2.00% to 4.85% depending on the product selected.

Bonus: 3% to 7% depending on product and state (Look at attached comparison for specifics)

Deposits: Single deposit only

Free withdraw provision: 10% per year

Surrender period: There is a 10 year product and a 15 year product

Income rider: Can be added for 1.25% fee. Provides a base minimum interest rate per year plus annual gains stacked on top.

Minimum Deposit: $5,000

Overall: The 100% annual point to point strategy with a spread is the best growth option available from any annuity currently. The income rider (also comes with a 3x payout for LTC) is competitive with others in the market but is on the higher end from a price standpoint at 1.25% a year. Call or email our office if you have questions, need additional detail or would like to get a quote.

If you are a broker, agent or advisor that wants to offer this product you may obtain a contract here.Aviva New Product Contracting May 2013 Note: This is not a standard Aviva contract. You must complete a contract specific to the Target product to be authorized to sell it. Completed contracts can be emailed ([email protected] ) or faxed (203)-567-6235 to our office.

Foresters currently has one of the lowest cost simplified issue final expense plans available. The commission for brokers/agents is 100% and can increase with production. They have an electronic application system and are approved in NY unlike most Final Expense plans. Commissions are paid directly to the broker/agent on a weekly basis.

If you would like to be appointed to sell Foresters, you may obtain the contracting here Foresters GA contracting May 2013 Completed contracts can be faxed to Crowe and Associates at 203-567-6235 or by email at [email protected] All contracts must include a copy of a valid insurance license and E and O certificate.

Foresters client application NY NOTE: Appendix 11 “Definition of Replacement” form must be completed with every application even if it is not a replacement

Once a broker is appointed, they are eligible to sign up for the voice signature online client application process with Foresters. This allows for prospects to be signed up through the phone and internet.

Vantis Life offers a 100% guaranteed issue life insurance policy called Guaranteed Golden. The GG product is the lowest cost guaranteed issue plan available for brokers to sell. Rates and applications are available in this post. The Guaranteed Golden Product offers the following features

100% Guaranteed Issue (No questions)

Cash value build up

permanent policy- rates never change

Face amounts of $5,000, $10,000, $15,000 and $20,000

Ages 50 to 80

Incredible rates!

Some applications are included in the links below but you can call or email us if you need an application for any state. Office number 203-796-5403 or email: [email protected]

Please note that the application for NY and FL is different than the one used for other states. All three are available here. Applications may be faxed or emailed to Crowe and Associates. Fax number is 203-567-6235 or email at [email protected]